National Labor Relations Board Ditches Decades-Long Precedent on Employers’ Unionization Threats

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On November 8, in Siren Retail Corp., 373 NLRB No. 135 d/b/a Starbucks, the National Labor Relations Board (NLRB or Board) overturned its categorical rule that immunized nearly all employers’ statements concerning the effects unionization would have on an employee’s direct relationship with management. Overall, this decision removes nearly 40 years of NLRB precedent and, in its place, imposes a heightened standard employers must consider before making such statements.

The Facts and the Holding

At issue in this case were statements made by company management in response to its workers’ latest attempt at organizing. More specifically, during a mandatory meeting to address unionization, one manager told employees that if they wanted to “maintain a direct relationship” with management, they should “check off no” during the union vote. Ultimately, the Board affirmed an administrative law judge’s (ALJ) earlier ruling and concluded that this statement did not violate the National Labor Relations Act (NLRA). However, in doing so, the Board reversed its 1985 Tri-Cast, Inc., 274 N.L.R.B. 377 precedent the ALJ had relied on.

In its Tri-Cast decision, when addressing the legality of similar statements, the Board concluded that there was “no threat, either explicit or implicit, in a statement which explains to employees that, when they select a union to represent them, the relationship that existed between the employees and the employer will not be as before.” Since then, the NLRB has consistently held that employers’ statements involving how unions will negatively impact an employee’s ability to individually address workplace issues with management are lawful — that is, until now.

The Board’s reasoning in expressly overruling Tri-Cast was that the Board previously erred in determining its holding to be a categorical rule. The Board noted that the application of Tri-Cast has “immunized employer campaign statements that, based on their content and context, could reasonably be understood to threaten employees with the loss of an established workplace benefit.” Furthermore, the Board reasoned that the NLRA was better served if the content and context of these types of statements were analyzed on a “case-by-case basis.”

What Does All This Mean?

Moving forward, the existing Board will analyze these types of statements under the same test set forth by the Supreme Court in NLRB v. Gissel Packing Co., 395 U.S. 575, 89 S. Ct. 1918 (1969) a case involving similar employer predictions on the adverse impacts of unionization. Under this framework, to be deemed lawful, any statements made by an employer about the negative consequences a union will have on its employees’ ability to individually address workplace issues with management “must be carefully phrased on the basis of objective fact to convey an employer’s belief as to demonstrably probable consequences beyond his control.” On the other hand, if an employer’s statement implies that they will end all direct interaction with employees over workplace issues if employees vote in favor of a union, that is a “threat of retaliation based on misrepresentation and coercion” that violates the NLRA.

Lastly, despite the imposition of this new heightened standard, employers should note that the Board concluded that this ruling would only be applied prospectively and not retroactively.

Steptoe & Johnson’s Labor Relations Team is familiar with union elections and can help you navigate union campaigns and other NLRA issues, avoid unfair labor practices, and more. If you have any questions about this recent NLRB decision or how it might affect you, please contact the authors of this alert.